The market is throwing an early morning hissy fit again. The three data points for today's opening are Walmart's warning, Iran nuclear program "tensions" and the attendant higher oil and AIG's writedowns.
The market needs AIG to pull a Merrill Lynch, and rally after the writedowns. It's trading under 26 pre-market. I'll take a shot on AIG by taking the stock here, and by buying the Aug 28 calls when they crush them at the opening, especially if I can pick them up at .30 or .40 cents.
Higher oil? That's the easy one to reverse. 48% of the open interest in NYMEX crude is controlled by speculators. Throw some more money at this bad bet, and bid up oil, and let CNBC breathlessly report the tensions in Iran.
In FL, we didn't have a tax free sale, but JC Penney gave their own with a 6% discount. The crowds at JCP showed that the consumer is still tight. At least the retail story is "honest." Oil isn't.
I'm betting this morning "hissy fit" won't last.